2006 (1) TMI 79

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....he appeals are directed against the order dated June 5, 2003 made in I.T.A. Nos. 999, 1000, 1001 and 1002/Mds/2000 for the assessment years 1996-97, 1997-98, 1998-99 and 1999-2000. The brief facts of the case are stated as under: The assessee is a partnership firm engaged in the business of chit and finance. During the survey, it was found that the assessee had accepted cash deposits of more....

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....hat the assessee was justified in receiving deposits exceeding Rs. 20,000 in cash when the depositors did not have bank accounts? (b) Whether, on the facts and circumstances of the case, the Tribunal was right in deleting the penalty under section 271D on the ground that the depositors did not have bank accounts, when section 269SS provides for payment either by cheque or bank draft?" Both t....

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....ank accounts. Under such circumstances, both the Commissioner and the Tribunal, exercising the discretion conferred under section 273B of the Act came to the conclusion that the transactions were found to be genuine and bona fide, and that the depositors did not have bank accounts and, therefore, the assessee was in no position to request them to make the deposits by cheque, assuming the same was ....

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....he assessee, as the case may be, for any failure referred to in the said provisions if he proves that there was reasonable cause for the said failure." The apex court, interpreting the powers conferred on the Revenue under section 273B of the Act in Asst. Director of Inspection (Investigation) v. Kum. A.B. Shanthi [2002] 255 ITR 258 held that if there was a genuine and bona fide transaction and....